H.R. 9179

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 9179 Introduced in House (IH)]

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119th CONGRESS
2d Session
H. R. 9179

To amend the Internal Revenue Code of 1986 to provide for adjustments 
in the individual income tax rates to reflect regional differences in 
the cost-of-living.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

June 8, 2026

Ms. Gillen (for herself and Mr. Lawler) introduced the following bill; 
which was referred to the Committee on Ways and Means

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to provide for adjustments 
in the individual income tax rates to reflect regional differences in 
the cost-of-living.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Cost of Living Tax Cut Act''.

SEC. 2. REGIONAL COST-OF-LIVING ADJUSTMENTS IN INDIVIDUAL INCOME TAX 
RATES.

(a) General Rule.--Subsection (f) of section 1 of the Internal 
Revenue Code of 1986 is amended by adding at the end the following new 
paragraphs:
``(9) Regional cost-of-living adjustments.--
``(A) In general.--In the case of an individual, 
for taxable years beginning after 2026 the rate table 
otherwise in effect under this section for any taxable 
year (determined after the application of paragraph 
(1)) shall be further adjusted as provided in 
subparagraph (B).
``(B) Method of making regional adjustment.--The 
rate table otherwise in effect under this section with 
respect to any individual for any taxable year shall be 
adjusted as follows:
``(i) The minimum and maximum dollar 
amounts otherwise in effect for each rate 
bracket shall be multiplied by the applicable 
multiplier (for the calendar year in which the 
taxable year begins) which applies to the 
statistical area in which the individual's 
primary place of abode during the taxable year 
is located.
``(ii) The rate applicable to any rate 
bracket (as adjusted by clause (i)) shall not 
be changed.
``(iii) The amount setting forth the tax 
shall be adjusted to the extent necessary to 
reflect the adjustments in the rate brackets.
If any amount determined under clause (i) is not a 
multiple of $50, such amount shall be rounded to the 
nearest multiple of $50.
``(10) Determination of multipliers.--
``(A) In general.--Not later than December 15 of 
each calendar year, the Secretary shall prescribe an 
applicable multiplier for each statistical area of the 
United States which shall apply to taxable years 
beginning during the succeeding calendar year.
``(B) Determination of multipliers.--
``(i) For each statistical area where the 
cost-of-living differential for any calendar 
year exceeds 125 percent, the applicable 
multiplier for such calendar year is 90 percent 
of such differential.
``(ii) For each statistical area where the 
cost-of-living differential for any calendar 
year exceeds 97 percent but does not exceed 125 
percent, the applicable multiplier for such 
calendar year is 1.05.
``(iii) For each statistical area where the 
cost-of-living differential for any calendar 
year does not exceed 97 percent (and, 
notwithstanding clauses (i) and (ii), in the 
case of any statistical area which is outside 
the United States), the applicable multiplier 
for such calendar year is 1.
``(C) Cost-of-living differential.--The cost-of-
living differential for any statistical area for any 
calendar year is the percentage determined by 
dividing--
``(i) the cost-of-living for such area for 
the preceding calendar year, by
``(ii) the average cost-of-living for the 
United States for the preceding calendar year.
``(D) Cost-of-living for area.--
``(i) In general.--For calendar year 2026 
and each calendar year thereafter, the 
Secretary of Commerce shall determine and 
publish a cost-of-living index for each 
statistical area.
``(ii) Methodology.--The cost-of-living 
index determined under clause (i) for any 
statistical area for any calendar year shall be 
based on average market prices for the area for 
the 12-month period ending on August 31 of such 
calendar year. The market prices taken into 
account under the preceding sentence shall be 
selected and used under the same methodology as 
is used by the Secretary of Commerce in 
developing Regional Price Parities indexes.
``(E) Statistical area.--For purposes of this 
subsection, the term `statistical area' means--
``(i) any metropolitan statistical area as 
defined by the Secretary of Commerce, and
``(ii) the portion of any State not within 
a metropolitan statistical area as so 
defined.''.
(b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2026.
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